Slideshow

Why 2016 was a year to forget for these 10 vendors

Whether it be technology troubles, government conflicts or declining sales, 2016 has been a year to forget for some of the industry's biggest players. ARN examines the vendors who will forever look back on 2016 as an annus horribilis.

  • 10 - Tintri While Tintri doesn’t command the same market respect as some of the more established storage vendors, news that the company closed its Australian operations in July hit the local industry nonetheless. In moving to handle all regional business out of its offices in Singapore, the vendor insisted that the consolidation of offices was "not reflective" of sales in Australia and New Zealand. Yet worryingly for Tintri, actions speak louder than words.

  • 9 - Mitel In July, everything appeared on the up for unified communications vendor, Mitel. Yet Polycom dramatically pulled the plug on the organisation’s proposed $US1.9 billion acquisition of the company, scrapping the deal to go private instead. Following a tense day of deliberating at the video conferencing vendor, over a years' worth of negotiating was wiped off the table after the company accepted a rival $US2 billion bid from Siris Capital Group LLC, a private equity firm based in New York. After failing to complete its merger with Polycom, Mitel has instead began the process of streamlining its business to go forth alone, revealing plans to sell its Mitel Mobility business to Xura for $385 million.

  • 8 - Violin Memory Once touted as a vendor of the future, flash storage company, Violin Memory, has seen its stock fall nearly 86 per cent over the last 12 months. As concerns mount about the vendor’s balance sheet, the company succumbed to the inevitable in December, making a Chapter 11 bankruptcy filing. Despite pioneering the all-flash array, Violin Memory has gone from industry upstart to complete oblivion amidst the rise of vendors providing new levels of technological innovation in an increasingly crowded market. Violin Memory serves as a sobering reminder for vendors attempting to disrupt the status quo in a market dominated by large established players.

  • 7 - Apple Somewhere beneath all the hype, Apple endured a pretty woeful 2016. Spearheaded by an uninspiring iPhone 7 launch, coupled with strange-looking AirPod headphones, the one-time darling of the tech industry delivered an less-than-stellar year of product releases. While Cupertino continues to be seen as the leader of innovation, the reputation is waning as critics question the vendor’s ability to move to the next level. In light of increased competition from Microsoft, from a hardware perspective - think Surface Studio - Apple found itself in unfamiliar territory in 2016, as customers speculate as to whether the company has lost its spark. To make matters worse, the tech giant was taken to task in Ireland by the European Commission, over unpaid taxes amounting to £10.8 billion.

  • 6 - Xerox Xerox has confirmed its intention to lay off even more workers in 2017, after announcing plans to split the company in half. Revealed in May, the split will see the emergence of two organisations, a document technology company, which includes its Document Technology and Document Outsourcing businesses, and a Business Process Outsourcing (BPO) company. The split will also see Ursula Burns, the first black woman to lead an S&P 500 company, step down from her role as CEO of Xerox. After the split, Burns will become chairman of the newly formed document technology company. Despite predications that sales declines would ease over the next three years, more layoffs are expected as the vendor continues to readjust to changing market conditions.

  • 5 - BlackBerry The BlackBerry smartphone is dead: Long live the BlackBerry smartphone. A week after it officially pulled out of the smartphone market, BlackBerry agreed to license its brand to handset manufacturer TCL in December. Consequently, the Chinese company will now make and market future BlackBerry handsets worldwide except for India, Indonesia, Bangladesh, Sri Lanka and Nepal, where BlackBerry has already struck local licensing deals. As the events of 2016 highlights, BlackBerry has simply failed to keep up with changes in the mobile market, recognising, too late, that its OS, although more secure than Android, could never compete without the support of app developers.

  • 4 - Telstra After starting the year with a string of outages, Telstra’s troubles deepened further following the departure of three senior executives. Under a cloud of controversy, the telco sacked CTO, Vish Nandlall, with the executive allegedly shown the door following months of internal pressure, “after he was found to have falsified his CV” amidst “allegations of plagiarism of presentation material”. While Nandlall has since been replaced by Håkan Eriksson, the organisation was also severely impacted by the exits of Kate McKenzie (COO) and Erez Yarkoni (CIO).

  • 3 - IBM Despite enjoying an encouraging start to 2016, IBM’s fortunes suffered a serious turn for the worst over the failure of the 2016 Census portal to withstand a series of distributed denial of service (DDoS) attacks in early August. Following the 40-hour outage - which inconvenienced millions of Australians who tried to fill out census forms online - Prime Minister, Malcolm Turnbull, hung Big Blue out to dry, insisting “heads will roll” following the saga. Fast forward to November and the tech giant paid a “very substantial” but confidential settlement which “absolutely” covered the cost of the census debacle. Yet questions remain in light of the “cosy relationship” between IBM and the Australian Bureau of Statistics (ABS), with subsequent post-event investigations suggesting trust in the vendor to be misplaced.

  • 2 - Hewlett Packard Enterprise For Hewlett Packard Enterprise, the year just gone will be forever defined as the year of the spin-off, as the vendor aggressively pursues plans to strip assets and remove costs. After initiating a tax-free spin-off and merger of its Enterprise Services business with CSC - designed to create a pure-play, global IT services powerhouse - the vendor also committed to a spin-off and merger of its non-core software assets with Micro Focus, in a transaction valued at approximately $8.8 billion. Collectively, the moves show a vendor shrinking spectacularly, with the industry unsure as to whether a slimmed down version of HPE can be successful in the years ahead. Locally, the vendor will hope the new year represents a clean slate with a new managing director on board, with Stephen Bovis replacing Alan Hyde in November. Yet in Australia, 2017 will no doubt begin in controversy as the Australian Taxation Office (ATO) outage investigation spills into the new year, following an “unprecedented” failure of HPE storage hardware in December. Akin to the IBM Census debacle, the ATO saga could prove to be an unhelpful distraction for a vendor undergoing serious transformational changes.

  • 1 - Samsung The strong Samsung that started 2016, differs remarkably to the disheveled Samsung that ends the year. With a brand reputation in tatters following the exploding Galaxy Note 7 debacle and the recall of 2.8 million washing machines, the vendor suffered its worst decline in smartphone sales during 12 months of ongoing strife. Fire-catching devices aside however, the tech giant also announced its intention to considering splitting the company in two, in a final bid to appease disgruntled shareholders. But perhaps most notably, 2016 will be remembered as the year of the exit for Samsung, following the sale of its printer division to HP in September. While a deal has yet to be officially confirmed, the vendor also looks set to drop its PC business through a quick fire sale to Lenovo in early 2017.

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